I just bought a Canon Digital Elph, Powershot SD630, and it is by far THEE best digital camera I have ever had, and you can get them for under $250!!
I have had several digital cameras and know quite a bit about them. I've had a few of each: Kodak (mostly crap cameras), Sony (crappy battery life), and Nikon (ok, mostly "grandpa" cameras), but this Canon SD630 is just flat out awesome! It has a rechargeable lithium ion battery that lasts a long, long time and fully charges in about 30 mins, is 6 megapixels (more than enough for any kind of consumer use), it has a huge 3" screen that is just awesome, and it has very good video/sound quality, tons of display options and picture editing options.
I have a 1gb card (about $30) and I can take about 10minutes straight of 640x480 30fps video with sound, that's the same resolution as a TV, which is very high quality for a digital camera that will fit in your shirt pocket. You can also downgrade the quality to 320x240 and 15fps (which is still fairly decent quality) and get like 45 mins of video!
The only thing I don't like about it is that it only has 3x optical zoom, but it does have like 8x digial zoom.
Overall awesome camera for the price, I highly reccommend it.